Q&A with Norman Radow, CEO at RADCO

Specializing in turning around “diamonds in the rough,” the RADCO founder discusses why Atlanta’s broad-based job and population growth are fostering demand for multifamily assets.
Norman Radow, CEO & Founder of RADCO

Norman Radow, CEO & Founder of RADCO

As one of the fastest-growing metros in the nation, Atlanta has become an economic powerhouse in recent years. The rapidly growing population and the favorable business climate have greatly contributed to a healthy rental and housing market. According to the latest Yardi Matrix multifamily report, the metro is adding 10,000-plus units per year, of which two-thirds are part of the luxury segment. The RADCO Cos. is one of the largest players in the Atlanta multifamily market. We wanted to catch a glimpse on how a local businessman perceives the metro’s recent development, so we’ve asked RADCO CEO & Founder Norman Radow to expand on the reasons his company continues to invest in The Gate City.     

MHN: Which words would you use to describe the current state of the Atlanta multifamily market?

Norman Radow: The misnomer is that there is one market. The fact is that there are two. In our space, the Class B value-added market, things could not be better. There is both no new supply and a larger cross section of the population that requires our product. The Double A core space is different. There, supply is growing and fewer people can afford to rent their inventory. So, you are seeing softness there for the next year, until all the supply comes online. After that, deliveries fall off a cliff and that market should stabilize.

MHN: Which Atlanta submarkets are most appealing to you now and why?

We like many markets. We follow the jobs. That is why the Interstate 85 corridor, the I-75 corridor and the Sandy Springs markets are particularly appealing.

MHN: One of RADCO’s main focuses is the redevelopment of Class B apartment communities.  What do you look for in a property when deciding to acquire it or not? For example, what attracted you to Ashford 6860 or other communities you own in the metro?

We look to buy properties in improving areas, which affords us one or more bites of the apple to invest in our community. For example, Ashford 6860 is right off I-85 and I-285, which is the perimeter highway. Access is amazing and with approximately 500,000 more people slated to move in and around this corridor in the next 20 years, it is the epicenter of everything. That means we can renovate the community for today’s resident and do so again as the market changes. Interview quote 827x221 MHN Norman Radow

MHN: How much do other sectors (such as industrial, manufacturing, etc.) influence the multifamily sector in metro Atlanta?

Atlanta has added 18 million square feet of distribution and manufacturing space per year as of late. These are amazing numbers. And, we follow the jobs these facilities create. Hence, we are in McDonough, Newnan and of course the I-85 corridor.

MHN: Surveys have positioned Atlanta among the top major U.S. metros for rent growth in recent quarters. What are the reasons you think this happened?

There are so many reasons: the Charleston, S.C., and Savannah, Ga., ports, the road and train infrastructure that all comes through Atlanta, and, of course, our airport. As important, we live in a right to work, low-tax, pro-business state with good weather. Who wouldn’t want to live here?

MHN: You’ve just purchased your 26th asset in metro Atlanta only. How much do you plan to expand this year?

We have purchased close to 40 communities in Georgia, but have sold 12 of them. Currently, we have nearly 10,000 apartments in the metro area, making us the second largest landlord in Atlanta. Right now, there is little on the market to buy and renovate. But, we are anxious to expand our footprint in our home town. If not this year, expect us to make as many acquisitions as we can in 2018.

Image courtesy of RADCO